Borrow 5.5 x Income First-Time Buyer Mortgages | NEW SCHEME

Hello and welcome back to our channel and podcast! My name’s Gemma, and here at WIS we talk about all things related to money, mortgages, and a positive money mindset.

On today’s episode of Let’s Talk Money and Mortgages, we’re joined again by Ifthihy (“Ifthi”), a trained accountant and mortgage advisor with over 10 years of industry experience, and one of the founding directors here at WIS.

What’s different about this new mortgage scheme?

Ifthi:

Most lenders allow you to borrow around 4.5x your income, depending on your credit commitments. Some lenders go up to 5x income, but usually only if you’re on a higher income.

This scheme is exciting because first-time buyers can now borrow up to 5.5x their income with a specific lender. It’s strictly for first-time buyers and can make a big difference when moving from a flat to a house or stretching affordability just that little bit further.

What are the income requirements?

Ifthi:

To qualify:

• Sole applicant → must earn at least £31,000.
• Joint applicants → must earn at least £50,000.

This is much more flexible than other lenders who typically require £75,000–£100,000 income to access higher multiples.

Who qualifies — employed, self-employed, or contractors?

Ifthi:

At the moment, this scheme is not open to self-employed applicants or contractors. It is only available to those who are employed.

You will also need a credit check. The lender is particular about credit scoring, so only applicants with a strong credit profile are likely to qualify.

What deposit is required?

Ifthi:

It depends on the type of property:

• Standard house purchase: 10% deposit.
• Apartment: 15% deposit.
• New-build house: 15% deposit.
• New-build apartment: 25% deposit.

This isn’t unusual, as new builds often require higher deposits anyway.

Can this be used with Help to Buy or other schemes?

Ifthi:

No. This scheme is for standard property purchases only. You can’t combine it with Help to Buy or similar government schemes.

What are the main advantages of this scheme?

Ifthi:

Higher borrowing power

Example: If you earn £50,000:

• 4.5x income = £225,000.
• 5.5x income = £275,000.

That extra £50,000 could be the difference between buying a flat and buying a house.

Fixed-rate options

Deals are available for five years or even ten years.

This gives long-term payment certainty and allows time for salaries to grow before remortgaging.

Cashback

The lender offers a small cashback as a thank-you for using their mortgages.

What are the disadvantages of this scheme?

Ifthi:

• Limited product choice: Only available from one lender (Nationwide Building Society).
• Long fixed terms: You’re locked into a 5-year or 10-year deal. Early repayment charges apply if you want to exit early.
• Income restriction: Not available if you earn less than £31,000 (sole) or £50,000 (joint).
• Not for self-employed/contractors: Only open to employed applicants.

Are there alternatives to consider?

Ifthi:

Yes. Don’t look at this scheme in isolation. Other lenders may offer:

• Up to 5x income (with potentially lower interest rates or fees).
• Help to Buy and other government schemes, which might suit some buyers better.

That’s why it’s best to speak to a broker who can compare options and look at the whole picture. For example, this scheme may not work well if you plan to move again within two years.

Who is the lender offering this scheme?

Ifthi:

It’s offered by Nationwide Building Society.

You can go directly to them, but if you come to a broker like us at WIS, we’ll check whether this scheme is actually the best fit for your circumstances — or whether another option might save you money in the long run.

Final Reminder

This scheme could be a great option for first-time buyers who:

• Have saved a good deposit.
• Earn enough to meet the income requirements.
• Want to stretch affordability to move from a flat to a house.

But it’s not for everyone, so professional advice is essential.

Reminder: A mortgage is secured against your home or property. It may be repossessed if you do not keep up with mortgage repayments.